Addressing Nigeria’s FX crisis via halting of unethical speculative practices
Over the past 4 months, the Naira has depreciated by more than 50 per cent above the official and parallel market segments after the Central Bank of Nigeria (CBN) collapsed all FX windows into the investors and exporters’ window, now called the Nigerian Autonomous Foreign Exchange Market (NAFEM). The move according to the CBN was part of government’s effort to improve liquidity and stability in the market and attract foreign investors into the Nigerian economy. While the policy was initially widely applauded as it was deemed well intentioned and necessary the first few months of its operation has put additional pressure on the local currency and manufacturers with its ripple effects on domestic prices. In response to this challenge, the CBN under the leadership of Dr Olayemi Cardoso, assured it is doing everything to raise the supply of FX. To prove its commitment, the apex bank announced the decision to eliminate long-standing for...